Technology Transfer

Applications for Research

Developing practical applications and commercial uses for research innovations is a fundamental aspect of business development. Both the development of initial applications for research results and the design of new applications for currently available technologies are important parts of business innovation. As a result, many government, university, and privatesector research organizations have dedicated offices for evaluating research and recognizing the commercial potential of particular results. In addition, many independent organizations and business concerns have emerged to offer support to research organizations for developing new applications. Academic research on the processes of technology transfer itself has also become an important source for analysis.

An important example of the perhaps only partially realized potential of research organizations is that of Xerox Palo Alto Research Center (PARC). PARC has produced many significant innovations that have been highly commercially viable, such as the laser printer and Ethernet. At the same time, the organization has been critiqued for failing to recognize the commercial potential of many of the organization's innovations. This highlights the importance of the technology transfer process itself and the difficulties entailed even in research organizations closely linked to commercial enterprises.

The status of research organizations as a part of commercial businesses has been a concern for government regulators in some technology industries. In the telecommunications industry, the Bell Labs component of AT&T was instrumental in the development of the theoretical foundation and technological components of telecommunications networks in the United States. Inventions such as the transistor, first developed at Bell Labs, were also subsequently used across a range of industries. After the antitrust case against AT&T in 1982, the company reduced its efforts to derive proprietary commercial benefits from the research of Bell Labs. For the most part, transfer functions continue to play an important role in companies with significant research and development capacities. Opportunities for technology transfer in this form also create significant incentives for links between major research universities and the private sector.

Technology Use in New Environments

The second important usage of technology transfer is with regard to the process by which technologies developed in one country are introduced in another country. The practice of borrowing technological tools has existed for as long as people from different areas have encountered each other, particularly through long-distance trade. More recently, opportunities for technology transfer have been highlighted as a key factor in economic development. The analysis of opportunities for “borrowing” technologies developed in other places has been an important aspect of economic historians' evaluation of the processes of the Industrial Revolution. Thorstein Veblen argued that Germany was able to industrialize quickly because it was using technologies developed in Great Britain, thereby reducing the size of investment in terms of time and capital in Germany and offering opportunities for more efficient use of these tools. Alexander Gerschenkron drew on this argument to highlight the ways in which late developers can take advantage of previously developed technologies, while also arguing that the processes of industrialization can lead to significant social and political strife. For the former colonies in the postwar period, development economists such as Albert Hirschman argued that industrialization, often using technologies designed in the already industrialized countries, could reduce the economic dependence of these countries on developed countries and utilize the underemployed populations. These efforts produced mixed results in terms of economic growth and employment, particularly in Latin America, and often led to political repression.

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